Common Market for Eastern and Southern Africa (COMESA) Free Trade Area (FTA) was launched on 31 October 2000 with nine Member States. This was the first FTA in Africa. Now, there are 19 Member States; 14 of them are full FTA Members trading on a full duty free and quota free basis, the remaining 5 countries are at a various stages of joining the FTA. Ethiopia is one of the non-FTA members of COMESA. The FTA has its own contribution to boost intra COMESA trade, it increased by nearly six-fold from USD 3.1 billion to USD 17.4 billion in 2011.
COMESA Member States
These include Angola, Burundi, Comoros, D.R Congo, Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Sudan, Swaziland, Uganda, Zambia and Zimbabwe.
Rules of Origin
The COMESA treaty provides that goods shall be accepted eligible for preferential tariff treatment if they originate in the Member States. Goods shall be accepted as originating in a Member State and comply with one of the five conferring criteria lists below:
1. Goods wholly produced in Member State ( that is , no raw material from outside the regions have been used in their manufacture):or
2. Goods satisfying the change of tariff heading resulting from their process of manufacture where some raw material are imported or
3. Goods produced in a Member State and the CIF value of any foreign (that is non-COMESA) materials used doesn’t not exceed 60% of the total cost
of all materials used in the production: or
4. Goods produced in member States whose value added resulting from the process of production accounts for at least 35% of the ex-factory cost of
the goods: or
5. Goods produced in member States designed in a list by the Council to be of particular importance to the economic development of the Member State and containing not less that 25% value added notwithstanding the provision states in no.3 above
Note: For goods to be admitted into COMESA State as originating in Ethiopia, the importer of the goods concerned must present to the Customs authority of importing country, alongside other documents a certificate of origin duly completed and signed in Ethiopia and certified by designated certifying authority of that Member State and the same goes for import goods as well
The application of the COMESA Protocol between the Member States is on reciprocal basis.
- The following countries have reduced their tariffs to zero rates and fully participating in the Free Trade Area (FTA).
These are Burundi, Comoros, Djibouti, Egypt, Kenya, Madagascar, Malawi, Mauritius, Rwanda, Sudan, Uganda, Zambia and Zimbabwe
Note: Eligible goods originating from these countries attract Customs duty at 0% in the Free Trade Area.
The status of tariff reduction for the under listed countries is as detailed below:
- Ethiopia 10%
- Eritrea 80%
Note: Eligible goods from these countries attract customs duty at the rates of the tariff reduction reached by each country as indicated above.
- Some countries have not effected any tariff reduction. These include DR Congo and Seychelles
Note: Goods from these countries shall attract customs duty at their substantive rates appearing in the Customs tariff Book.
- Swaziland under derogation. This means is that imports from Swaziland will attract customs duty at 0% while exports to Swaziland will attract customs duty.
What the Exporter should do to obtain a certificate of origin to be benefiting from the preferential market access?
- An exporter intending to export goods from Ethiopia to COMESA countries and desiring to have such goods granted preferential tariff treatment in the importing country must obtain a certificate of origin from Ethiopian Chamber of Commerce and Sectoral Association. The certificate, when presented by the importer to Chamber in the importing country will serve as evidence to enable the goods to be accorded the preferential tariff treatment being sought.
2. The exporter/manufacturer must present to Chamber evidence that the goods have been produced in conformity with conditions specified in the Rules of Origin when applying for certificate in respect of goods being exported.
3. Where the goods have been produced by a company or enterprise that is not exporter seeking the certificate of origin, then, the exporting company or enterprise must obtain from producer a declaration in the prescribed form. The exporter should ensure that such information is correct.
4. The exporter must complete the certificate of origin form.
5. While the exporter is free to decide whom to sign declarations on his behalf, it is highly desirable that the person so authorized be member of the exporting firm. Declarations signed by shipping or forwarding agents are not acceptable.
6. For further consultation you can contact Addis Ababa Chamber of Commerce & Sectoral Association business support department at any time. additional documents available at AACCSA web site www.addischamber.com